Exxon wins shareholder backing for legal move to Texas

By Sheila Dang and Arunima Kumar

HOUSTON, May 27 (Reuters) – Exxon Mobil shareholders on Wednesday approved the company’s plan to redomicile in Texas, marking a win for the top U.S. oil producer after two leading proxy advisory firms advised investors to strike down the proposal.

The oil producer is incorporated in New Jersey, but the company has been headquartered in Texas since 1989. It said moving its legal home to the state was logical and made more sense for the business.

Other companies, including SpaceX, Tesla and Coinbase, have recently shifted operations to the Lone Star State. A Texas law passed last year ​enhanced legal protections for businesses in several ways, including reducing the threat of shareholder litigation by allowing ⁠companies to set stock ownership thresholds for lawsuits.

When it announced in March its plan to switch the state of incorporation from New Jersey to Texas, Exxon said it did not plan to raise its ownership thresholds for shareholder lawsuits and argued that Texas officials have a better understanding of its business. 

“The Board believes Texas legislators, judges, and juries who might make decisions that impact ​Exxon Mobil are generally more familiar with our business and operations,” the company said in its proxy filing.

Exxon shareholders also on Wednesday rejected a proposal to add more automatic voting options to Exxon’s retail investor voting program. Exxon’s board opposed the proposal.

(Reporting by Sheila Dang in Houston and Arunima Kumar in Bengaluru; Editing by Joyjeet Das, Nathan Crooks, Rod Nickel)